Brussels, 03/07/2009 (Agence Europe) - The newly appointed French minister for food and agriculture, Bruno Le Maire, met the president of the European Commission, José Manuel Barroso, for one hour on Friday 3 July to discuss current agricultural issues and in particular the crisis in the dairy sector and the future of the common agricultural policy (CAP). According to the French minister, who addressed the press after his meeting with Mr Barroso, France and the Commission agree that agriculture is a “strategic player”. On the subject of the milk crisis, Barroso said the communication to be issued by Mariann Fischer Boel, Agriculture Commissioner, on 22 July was “very important”, as it provides an analysis of the sector and sets out possible solutions for stabilising the market for milk and dairy products. France awaits “concrete proposals” on this text, Mr Le Maire said. A joint Franco-German letter was sent to Ms Fischer Boel calling for additional measures to be taken in favour of milk producers.
During his meeting with Mr Barroso, the French agriculture minister highlighted: 1) The need for regulation of farm production, as was recently done for the financial sectors. Bruno Le Maire told the press this would be “France's red line for renegotiation of CAP after 2013”. He said agricultural income in France and elsewhere has experienced “unacceptable” ups and downs (in France, agricultural income fell by 20% in 2008). Regulation is therefore needed to guarantee stable and decent income for farmers (not just for milk farmers). (2) The need for price transparency (with the setting in place of price observatories at European level). If we are to believe Mr le Maire, Barroso is in favour of progress in the field of transparency; and (3) The importance of placing innovation and investment at the heart of the agri-food industry.
The French minister asked whether milk quotas are really the solution to the crisis. Before answering “I do not think so”, he repeated that production regulation is needed to ensure stable and decent incomes and that there is no magic formula. In his view, a mechanism is needed to regulate production, “but not necessarily quotas”. For the past two years, dairy quotas have increased by 1% each year. They are planned to simply disappear at the end of March 2015. For many producers, this rise in quotas entails over-production and explains why prices are currently plummeting.
Franco-German letter on milk and future of CAP. Bruno Le Maire and his German counterpart, Ilse Aigner, sent a joint letter, on Thursday 2 July, to Mariann Fischer Boel asking her to envisage supplementary measures in favour of milk producers. Both German and French ministers, who met in Stuttgart on Thursday, point out that, on 22 July, the Commission must submit an in-depth market analysis, indicating the possible formula for stabilising the milk product market (in line with the conclusions of the last European Council). France and Germany request that the report should not “close the door” to a possible freeze on the rise in milk quotas scheduled for 2010. This request is not new and for now it is rejected by the Commission and several EU countries. At any rate, as Ms Aigner and Mr Le Maire state in their letter, new forms of regulation at European level will be needed to prevent the milk sector from being dependent on market rules alone.
Furthermore, on the subject of immediate measures, France and Germany welcome the Commission's intention to suggest that the Council extend the intervention period for butter and milk powder and, as the letter to the commissioner states, they hope the duration will be adjusted to the gravity of the situation. The two countries also recommend: - revalorisation of export refunds for cheese and a fall in minimum prices for cheese that benefit from refunds; - initiation of global reflection on market volatility, as well as the organisation of channels, for example in the context of contractual relations; - and examination of communication modalities on production locations, so that consumers are kept correctly informed.
The French agriculture minister also announced the setting in place of a Franco-German working group “to prepare for the future of the CAP after 2013”. First meetings will begin in September. Finally the cabinets of the two ministers have decided to appoint one official to establish “strong and close Franco-German relations to the service of European agriculture”. (L.C./transl.jl)